The social security system in Poland is of a general and compulsory character. Social security – in respect of selected risks – covers persons who are, inter alia, employees, persons who work on the basis of contracts of mandate or who carry out business activity.
Social security in Poland covers the EU citizens on the same basis as Polish citizens.
Pension insurance is an insurance provided in the event of inability to work because of old age. Persons who pay premiums, ensure their income at the moment of stopping professional work, after achieving pensionable age.
The reform of the pension system entered into force on 1 January 1999. It introduced a three-pillar system:
Pillar I is governed by the public institution – Social Insurance Company,
Pillar II is governed by private institutions – open pension funds (OFE) – An open pension fund is a legal person whose aim is to collect funds from insurance premiums and invest them on the financial market. Those funds are designated for pensions for the open pension fund’s members when they reach pensionable age.
Pillar III, voluntary, which is to ensure extra benefits for additional premiums, is occupational pension schemes (PPE) and individual retirement accounts (IKE). From 1 May 2011 until 31 December 2016, the Social Insurance Company forwards part of the pension insurance premium to the open pension fund selected by the insured person, in the amount of:
- 2.3% of the basis of the assessment of the amount of the pension insurance premium due for the period from the date of entry into force of the Act until 31 December 2012;
- 2.8% of the basis of the assessment of the amount of the pension insurance premium due for the period from 1 January 2013 until 31 December 2013;
- 3.1% of the basis of the assessment of the amount of the pension insurance premium due for the period from 1 January 2014 until 31 December 2014;
- 3.3% of the basis of the amount assessment of the of the pension insurance premium due for the period from 1 January 2015 until 31 December 2016.
The account of the insured person at the Social Insurance Company includes a sub-account where information is recorded on the valorised amount of paid premiums to Pillar II from the part of the premium not forwarded currently to open pension funds, together with the recovered interest on arrears for those premiums. The division of the premium between the pension fund which is at the Social Insurance Company’s disposal and an open pension fund is obligatory for insured persons born after 31 December 1968. Insured persons born after 31 December 1948 and before 1 January 1969 could join a selected open pension fund until 31 December 1999. Persons born before 1 January 1949 could not and still cannot join an open pension fund, their whole premium is forwarded to the Social Insurance Fund.
The pension premium is financed equally by the employer and the insured person, but the whole premium paid to the open pension fund is from the part paid by the insured person. The employer is responsible for paying premiums to the Social Insurance Company.
The pension system is based on the tight connection between the amount of the benefit and the amount of the actually paid premium. The basis for calculating the pension is the (total) amount of premiums for pension insurance.
Pension is granted to women who are at least 60, and men who are at least 65. There is no minimum insurance period required for granting the pension.
Decisions about granting pensions are made by the Social Insurance Company’s bodies which are of proper jurisdiction due to the place of living of the person who is applying for the benefit. The proceedings for granting pensions start after submitting the application by an applicant.
Disability insurance guarantees cash benefits in case of losing income connected with the risk of disability (inability to work) or death of a breadwinner in a family. In such a situation persons who pay disability insurance premiums are granted disability pension for incapacity for work, which is a substitution for remuneration or income, and in the case of death of an insured breadwinner in a family, the members of their family are granted family pension.
The premium for disability insurance is 8% of the basis of the assessment of the amount of premium, where 6.5% is from the funds of the employer, and 1.5% from the funds of the employee.
1. Disability pension for incapacity for work
Disability pension for incapacity for work can be granted to an insured person who fulfils all of the following conditions:
- is considered a person who is partially or entirely unable to work,
- has proven contributory and non-contributory periods,
- inability to work started in the periods strictly set out in the Act.
A person who is entirely unable to work is a person who has lost the ability to perform any job.
A person who is partially unable to work is a person who to a considerable degree lost their ability to perform a job which is consistent with the level of that person’s qualifications.
Inability to work and its level is certified by a board certified occupational medicine physician from the Social Insurance Company as the first certifying instance. An applicant has the right to raise an objection to the physician’s opinion to the Social Insurance Company Medical Board – as the second certifying instance.
2. Family pension
Family pension is granted to entitled family members (children, widow, widower, parents) of a person who at the moment of death took pension or disability pension for incapacity for work, and a working person who had the required periods for granting pension or disability pension for incapacity for work. When analysing the right to the family pension, it is assumed that a deceased person was entirely unable to work.
3. Training allowance
Training allowance is granted to a person who fulfils the conditions for granting disability pension for incapacity for work, and with reference to whom retraining was stated as appropriate due to the inability to work in the current profession. It is granted for the period of 6 months. That period can be shortened or lengthened up to 30 months. The amount of training allowance is 75% of the basis of an assessment, and when the inability to work is the result of an accident at work or occupational disease – 100% of the basis of its assessment.
Social security for industrial accidents and occupational diseases
Security for industrial accidents and occupational diseases covers, inter alia, employees, persons who work on the basis of contracts of mandate, and persons carrying out business activity.
Benefits for industrial accidents and occupational diseases can be granted to a person who is insured for such cases. These are:
- sickness benefit – for an insured person whose inability to work has been caused by an industrial accident or occupational disease,
- rehabilitation benefit – is paid after the sickness benefit has finished, if the insured person is still unable to work, and further treatment or rehabilitation give them a chance to regain ability to work,
- compensating benefit – is for an insured person who is an employee, whose remuneration was lowered due to permanent or long-term damage to their health,
- one-time compensation – for an insured person whose health was damaged permanently or for a long period of time, or for the members of the family of a deceased insured person or a person who collected disability pension,
- disability pension for an industrial accident or occupational disease – for an insured person who has become unable to work due to an industrial accident or an occupational disease,
- training allowance – is granted to a person with reference to whom retraining was stated as appropriate due to the inability to work in a current profession because of an industrial accident or occupational disease,
- family pension – for the family members of a deceased insured person or a person entitled to disability pension for an industrial accident or occupational disease and allowance to family pension – for an orphan,
- attendance allowance – for a person who is entitled to pension, considered entirely unable to work and existence on their own, or who is over 75,
- covering the costs of treatment – in the field of dentistry and preventive vaccination and supply of orthopaedic equipment, within the scope stipulated by the Act.
The amount of the accident security premium varies from 0.67% to 83.86% of the basis of premium assessment. The accident security premium is entirely covered by the employer.
Social security for sickness and maternity
Persons who are obligatorily insured for sickness and maternity are mainly employees. Persons covered by obligatory pension and disability pensions insurance, who, inter alia: work on the basis of an agency agreement or contract of mandate, carry out non-agricultural activity (business activity, authors, artists, freelancers) can also be insured, voluntarily, for sickness and maternity.
The amount of premium for insurance for sickness and maternity is 2.45% of the basis of the premium assessment. The premium is covered from the insured person’s funds.
The following benefits are paid due to insurance in case of sickness and maternity:
- Sickness benefit – The sickness benefit is granted to an insured person who became ill during the period of sickness security. Generally, the right to the sickness benefit is granted after the so-called waiting period. A person who is obligatorily covered by sickness security, gains the right to the sickness benefit after the period of 30 days of continuous sickness security. A person who is covered by this security voluntarily, gains it after the period of 90 days of continuous sickness security.
The sickness benefit is granted to an insured person in the amount of 80% of the basis of assessment, and for the period of being hospitalized – in the amount of 70% of the basis of assessment.
If the inability to work which was caused due to an accident on the way to or from work started during pregnancy or concerns tissue, cell or organ donors, then the sickness benefit is paid in the amount of 100% of the basis of assessment.
- Rehabilitation benefit – The rehabilitation benefit is granted to an insured person who can no longer be given the sickness benefit but still is unable to work, and further treatment or rehabilitation give them a chance to be able to work again. The benefit is granted for the period necessary to give them a chance to regain ability to work but not longer than for the period of 12 months,
- Compensating benefit – The compensating benefit is granted only to insured persons who are employees. That benefit is granted to employees whose remuneration was lowered due to undergoing professional rehabilitation or who was moved to another post due to the state of health,
- Maternity allowance – Maternity allowance is granted to an insured woman who at the time of sickness security or at the time of a child care leave:
- gives birth to a child;
- takes a child up to 7 years of age for upbringing, and in the case of a child with regard to whom there was a decision about an adjournment of compulsory education – up to 10 years of age, and who started legal proceedings for adoption in the Guardianship Court;
- takes for upbringing, as surrogate parents, except for professional surrogate parents not related to the child, a child up to 7 years of age, and in the case of a child with regard to whom there was a decision about an adjournment of compulsory education – up to 10 years of age;
- Provisions concerning the right to maternity allowance in the case of taking a child for upbringing are also to be followed in the case of an insured man. Maternity allowance is paid during the period of maternity leave – for 20 weeks in the case of giving birth to one child (possibly longer, in the case of giving birth to more than one child at a time – from 31 to maximum 37 weeks) and throughout the period of the additional maternity leave;
- Maternity allowance can be also granted to an insured father of a child for the period of 2 weeks as the period of maternity leave which can be granted to an employee-father raising a child.
The amount of maternity allowance is 100% of the basis of the allowance assessment. The basis of the allowance assessment is an average monthly remuneration paid for the period of 12 months before the month in which the right to the allowance is created.
Premiums for pension and disability pension insurance are calculated from maternity allowance (Those premiums are financed from the State budget).
- Attendance allowance – Attendance allowance is granted for the period of a special leave, when it is necessary to take care of a healthy child who is under 8, a sick child who is under 14 or other sick member of the family.
Attendance allowance is granted for not more than 60 days in a calendar year if a person takes care of a healthy child who is under 8 or a sick child who is under 14. If a person takes care of a sick child who is over 14 or other sick member of a family, the allowance is granted for not more than 14 days. The allowance is paid in the amount of 80% of the basis of allowance assessment.
Additionally, in the case stipulated in Article 180(61) of the Labour Code, the insured father of a child is entitled (irrespective of the attendance allowance for 60 days per calendar year) to an attendance allowance in the amount of up to 8 weeks if he interrupts employment or other gainful activity in order to take care of the child.
Social Insurance Company
The bodies which are entitled to decide upon the right to a benefit, examining and assessing the submitted documents are only the Social Insurance Company’s bodies of proper jurisdiction due to the place of living of a person who is applying for the benefit.